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Volume 2 - Opinions of Counsel SBEA No. 8

Opinions of Counsel index

Public authorities (Environmental Facilities Corporation) (taxable status) - Public Authorities Law, § 1296:

Real property owned by the Environmental Facilities Corporation, a public benefit corporation, used for any project and located outside the boundaries of the contracting municipality, is exempt from taxation but would be subject to payments in lieu of taxes, special ad valorem levies and special assessments if the property had been subject to taxation on the latest assessment roll completed, verified and filed preceding the date of acquisition by the corporation.

Our opinion has been requested as to the taxable status of real property owned by the New York Environmental Facilities Corporation.

          The Environmental Facilities Corporation is a public benefit corporation for planning, financing, constructing, maintaining and operating sewage treatment works, air pollution control and water management facilities and other facilities on behalf of, and in assistance to, municipal and state agencies. Formerly, some areas of operation were under the auspices of the State Pure Waters Authority. However, in 1970, the State Pure Waters Authority was reconstituted by the legislature and continued as the Environmental Facilities Corporation.

As a general rule, real property owned by the State or any of its departments or agencies is exempt from taxation unless the legislature expressly provides for taxation.

Section 1296 of the Public Authorities Law provides that real property owned by the Environmental Facilities Corporation is exempt from special assessments.

However, subdivision 2 of that section provides for payments in lieu of taxes, special ad valorem levies and special assessments as follows:

“2. Real property owned by the corporation (1) used for or in connection with any project or projects, (2) which is located outside the boundaries of the contracting municipality or municipalities, and (3) which was subject to taxation, special ad valorem levies, or special assessments on the latest assessment roll finally completed, verified and filed preceding the date of acquisition thereof by the corporation shall be subject to payments in lieu of taxes, special ad valorem levies and special assessments by the corporation in accordance with the provisions of this section.”

May 4, 1972

Updated: